2010: 93% of income gains went to the top 1%

posted by Lana N. | 3pt
March 06, 2012

The 1% had a fantastic year in 2010, reports Washington Post. While the recession hit everyone hard at first, in 2010 America's top 1% of earners saw a huge jump to 19.77% of national income. While on average the 99% lost money between 2009 and 2010, the top 1% saw an increase in income of about $42,685 (excluding capital gains). Inequality is on the rise. Check out the chart and article below for more details:[caption id="" align="aligncenter" width="500" caption="photo via Washington Post"][/caption]

In recent months, some commentators wondered whether the national conversation over inequality was coming too late. Early data suggested that the top 1 percent’s share of national income had dropped from 23.5 percent to 18.1 percent in the early years of the recession. “We don’t want to spend years focused on income inequality, only to learn that the financial crisis fixed it for us,” wrote the Atlantic’s Megan McArdle.

The latest update to Emmanuel Saez and Thomas Piketty’s income data suggests we need not worry. Timothy Noah summarizes:

In the first year of the recovery, 93 percent of all income gains went to the top 1 percent.

In other words, the very rich had a bad 2009, but an incredible 2010. Their share of national income bounced back to 19.77 percent. So inequality is marching upward once again. And there’s reason to believe this will keep going.

We mainly talk about income inequality, but wealth inequality matters, too. For most households, their wealth is in real estate. Those assets aren’t returning to pre-crisis levels anytime soon. But for rich households, their wealth is in financial assets, and those assets are recovering much more quickly.